In the last five years, occupancy at the Memorial Union Hotel has been steadily declining, and the Memorial Union could soon be forced to convert part of the hotel to student office space.

“Under the new budget model, we will be required to pay the utility expenses for the hotel,” said Richard Reynolds, director of the Memorial Union. “If we don’t increase occupancy, there will be a point in time when we will actually have to subsidize the hotel operation.”

The MU Hotel is in the midst of a three-year evaluation that will end next fall, when the Union will decide whether or not the hotel is financially viable.

“If we get to the point where the hotel does not make any net revenue or we have to subsidize it, that’s really the point that we shouldn’t be in the hotel business, and we will have to convert the hotel to other uses,” Reynolds said.

One proposed solution is to convert part of the hotel to office space for campus media organizations. A facilities committee is considering whether converting one floor of the hotel to approximately 6,000 square feet of office space – with tenants paying steady rent – would keep the hotel viable.

Reynolds said the MU Hotel has seen a decline in occupancy since 9/11, citing a nationwide decrease in travel and the “dated appearance” of the hotel rooms.

“We went from about a 60 percent occupancy rate down to … between 45 and 49 percent occupancy [in the last five years],” Reynolds said.

The hotel includes rooms with 17 different floor plans, mostly decorated in what Reynolds described as “’50s, ’60s, maybe ’70s vintage” styles.

“In the years between the early ’50s and the time the Union became a part of Iowa State University, there was not a lot of re-investment into the hotel rooms themselves,” Reynolds said. “We have rooms with beautiful, vaulted ceilings with a lot of floor space, and then we have some other rooms that, when you put a king-sized bed in those rooms … the floor plan is too small.”

The variety of floor plans, vintage decorations and increased competition with hotels in Ames led the MU Hotel to bring in a consulting team in 2005 to evaluate the facility.

“We were no longer preferred property because we sort of had a dated look,” Reynolds said.

The consulting team suggested remodeling the rooms to make the MU Hotel as modern as other hotels in Ames. One room, dubbed the “model room,” was completely made over by the MU maintenance staff to emulate other hotels, but Reynolds said converting all of the rooms to this enhanced standard is not financially possible.

In the last four years, new amenities have been added to the rooms to increase customer appeal and satisfaction as the budget and hotel revenue allows. The hotel also invested in a commercial laundry and upgraded its linens, significantly decreasing the expense of leasing linen and laundry service.

Other MU Projects

University Book Store

The University Book Store renovation is the final phase of a two-year renovation project that started in 2006. The project is expected to be completed in April. Additional retail space with a south entrance was the initial focus of the project, Reynolds said.

Multicultural Center

A multicultural center is another project set to begin soon, with demolition beginning this coming Monday, Reynolds said. The center will be funded by a student fee of $3 per student per semester and will feature an art display, study rooms and a small library.

Additional capacity for prospective and future students in admissions programs has led to the construction of an Admissions Visitors Center starting this spring.

“This will be a great new presentation space to welcome prospective students and families to campus before they tour ISU’s beautiful campus,” said a construction update available on the MU Web site.